What is the Definition of Employment Agency?
Full Question:
Answer:
I looked at the in-house services section of your website, regarding temporary staffing. Whether or not your company fits the definition of an employment agency will be a matter of determination for the licensing board of each state, based on all the facts involved, as the definitions of an employment agency vary by state. For example, MD statutes exclude a company that conducts a business that directly employs individuals to provide part-time or temporary services to another person from the definition of an employment agency. Technically, persons not directly employed by the business, but employed as independent contractors would not fall within this exemption. I suggest you use the links I sent previously to contact the licensing boards of the applicable states to inquire further.
One of the most important considerations in determining whether someone is an independent contractor or employee is the degree of control exercised by the company over the work of the workers. An employer has the right to control an employee. It is important to determine whether the company had the right to direct and control the workers not only as to the results desired, but also as to the details, manner and means by which the results were accomplished. If the company had the right to supervise and control such details of the work peformed, and the manner and means by which the results were to be accomplished, an employer-employee relationship would be indicated. On the other hand, the absence of supervision and control by the company would support a finding that the workers were independent contractors and not employees. Whether or not such control was exercised is not the determining factor, it is the right to control which is key.
Another factor to be considered is the connection and regularity of business between the independent contractor and the hiring party. Important factors to be considered are separate advertising, procurement of licensing, maintenance of a place of business, and supplying of tools and equipment by the independent contractor. If the service rendered is to be completed by a certain time, as opposed to an indefinite time period, a finding of an independent contractor status is more likely.
Please see the following MD statute:
§ 9-101 BUS. REG. Definitions.
(a) In general. — In this title the following words have the meanings
indicated.
(b) Client. — "Client" means an individual who seeks employment through
an employment agency.
(c) Commissioner. — "Commissioner" means the Commissioner of Labor and
Industry.
(d) Employment agency. — (1) "Employment agency" means a person who,
for a fee:
(i) obtains, offers to obtain, or attempts to obtain:
1. an employee for a person who seeks an employee; or
2. employment for a client;
(ii) provides to a client information to enable the client to obtain
employment;
(iii) obtains, offers to obtain, or attempts to obtain employment or an
engagement in connection with an entertainment, exhibition, or
performance, including:
1. a ballet;
2. a circus;
3. a concert;
4. the legitimate theater;
5. modeling;
6. a motion picture;
7. an opera;
8. a phonograph recording;
9. the radio;
10. a transcription;
11. television;
12. the variety field; or
13. vaudeville; or
(iv)1. obtains, offers to obtain, or attempts to obtain an alien labor
certification or immigrant visa for an individual; and
2. participates directly or indirectly in the recruitment or supply of
an individual who resides outside of the continental United States for
employment in the continental United States.
(2) "Employment agency" does not include a person who merely:
(i) conducts a business that directly employs individuals to provide
part-time or temporary services to another person;
(ii) as a lawyer, directly obtains an immigrant visa for an
individual;
(iii) conducts a business that:
1. receives a fee that is paid wholly by an employer;
2. does not collect money from an individual seeking employment; and
3. does not require an individual seeking employment to make a
contract; or
(iv) operates a nursing referral service agency that is licensed under
Title 19, Subtitle 4B of the Health — General Article.
§ 9-102 BUS. REG. Scope of title; certain organizations exempt.
This title does not apply to:
(1) a charitable, educational, fraternal, or religious organization
that does not charge a fee for its services other than ordinary dues for
membership;
(2) a labor organization while obtaining or attempting to obtain
employment for a member of the organization; or
(3) an organization of employers while obtaining or attempting to
obtain help for a member of the organization.
